04:25 PM EDT, 06/13/2025 (MT Newswires) -- The Toronto Stock Exchange fell off a record high on Friday amid likely profit taking after two days of record closes and as one veteran market watcher, David Rosenberg, said "recessionary thumbprints" were all over today's Canadian manufacturing sales data.

The resources heavy S&P/TSX Composite Index closed down 111.4 points at 26,504.35, but losses were capped due to higher commodity prices and the prospect of more gains to come for gold and oil as safe havens amid growing growing violence in in the Middle East after Israel launched strikes on Iran, sending all major global indices lower.

Most sectors were lower, led by Info Tech, down near 2.6%, and Industrials, down 1%. Both Energy and Health Care were up by 2% or more.

On the Canadian economic picture, David Rosenberg said the Q1 pickup in the Canadian economy, as he had been suggesting all along, was "an illusionary pre-tariff spurt of growth". The second quarter is now looking to be "flat at best", Rosenberg added, while noting manufacturing sales sagged -2.8% month over month in April, which was even worse than an already downcast -2.0% consensus estimate and followed on the heels of a -1.4% March slide. This marks the third consecutive contraction in industrial activity, swinging the year over year trend from +1.4% in March to -2.7% in April and taking the level to its lowest reading since January 2022.

"And," Rosenberg said, "you can't totally blame lower oil prices because ex-energy shipments dropped by -1.8% MoM, which was matched by a comparable setback in total volume activity in the month. In real or inflation-adjusted terms, shipments have now fallen in each of the past three months and in four of the past five -- to the weakest level since January 2022."

Rosenberg also noted wholesale trade dropped by 4.4% month over month and ex-energy by 2.2%, while volumes "crashed" by -4.6% sequentially and posted sizeable" declines in three of the past four months. He said: "I realize that it is retail sales that always dominates the market's attention and the air waves, but what is not appreciated is that retail sales are just 60% of the wholesale trade sector. The wholesale price deflator is running at -2.6% on a YoY basis, swinging down from +6.4% a year ago."

According to Rosenberg, "how the Bank of Canada can just sit on the sidelines as a casual observer is a good question as the disinflationary output gap widens further". But, he noted, the information to hand explains the behavior of the Canadian dollar, which has been the second weakest G-10 currency this year, "flattered only by the ever-sagging U.S. dollar".

Sometimes, Rosenberg said, "giddiness and animal spirits can overtake the stock market even in the context of a squishy soft economy". The implications for April and Q2 GDP are "squarely negative" and "recession risks are alive and well", he added.

Of commodities today, gold traded at a record high mid-afternoon on Friday as safe-haven buying surged after Israel launched overnight attacks on Iranian nuclear facilities and military leadership. Gold for August delivery was last seen up $48.80 to US$3,451.20, topping the prior record close of $3,425.30 set on April 21.

On gold related matters, a court-appointed receiver plans to start sifting for gold in cyanide-laced water stored at the Eagle Gold Mine in Yukon, the Canadian Press is reporting, noting the Yukon government says proceeds will be used to help pay for some of the cleanup after the mine. The failure of the mine's heap-leach facility, which contained millions of tonnes of cyanide-laced ore and water, set off the disaster and subsequent takeover by the receiver, Friday's report noted.

Meanwhile, West Texas Intermediate crude oil closed at a four-month high amid fears of a spreading conflict in the Persian Gulf, which supplies more than a fifth of the world's oil. WTI oil for July delivery closed up $4.94 to settle at US$72.98 per barrel, the highest since Feb. 11, after earlier touching US$77.62, while August Brent crude was last seen up 4.72 to US$74.08.

Staying on oil, Vikas Dwivedi, Global Energy Strategist at Macquarie, published a note that was prepared prior to latest developments in the Middle East between Israel and Iran, and said Macquarie's fundamentals "remain the same for the time being".

Dwivedi said: "We anticipate bearish fundamentals and producer hedging will limit the continuation of the current rally and pressure oil price toward US$60 again over the next two to three months. After peak summer runs and draws, our balances continue to point to a heavily oversupplied market. That said, we believe the drivers of current price strength include a combination of macro, geopolitical, and crude microstructural factors.

Initially, Dwivedi noted, the market anticipated OPEC could announce an accelerated return of barrels in July greater than the 3-month increments planned in May and June. Then May actuals came in below expectations, which caused the market to fade OPEC's return trajectory, a dynamic that contributed to the recent rally.

Dwivedi said the recent cooling in trade tensions between the U.S. and China has renewed some macro optimism and resulted in the reduced likelihood of a trade war 2.0 triggering a global economic slowdown. He added this development could support better global oil demand outlooks and provide price support.